7/01/2005

An interview with the attorney who argued the landmark eminent domain case, surveying the blight in the wake of the Supreme Court's decisionBy Tim Cavanaugh

Reason: Are you surprised by the decision?

Scott Bullock: Well I was surprised. It was rather shocking that a majority of the Supreme Court would permit this type of abuse. We're in an America where, as Justice Sandra Day O'Connor points out, church property can be taken for a Costco, a farm can be turned into a factory, and a neighborhood can be leveled for a shopping mall. Most people cannot believe that this can happen in this country and the Supreme Court gave sanction to that with their decision.

Reason: What did you make of Justice Anthony Kennedy's vote against the plaintiffs?

SB: Yeah, it was surprising. I mean here's a guy who once wrote "individual freedom finds tangible expression in property rights." For him to be in a decision that fundamentally violates the right to own and enjoy your property, I think, is disgraceful.

Reason: Is there any recourse to the plaintiffs now?

SB: There is. There are going to be battles on two fronts. One, we're going to do everything in our power to keep these people in their homes. And we're going to explore all options to do so. But one thing that's coming out of this opinion that's very clear is that people are furious about this. And the anger comes from the left, right, libertarians, and everybody in between. People cannot believe that the court sanctioned something like this. So, I think that the growing grassroots rebellion against this is going to gain momentum. And I think that you'll see litigation about this in state courts, where the battle will largely be, at least for the time being. And you'll see a number of legislative changes though both legislatures and then also through the initiative process, as well. And we'll be there every step of the way to make sure that these abuses stop.

Reason: Given how many frivolous Constitutional amendments get proposed there days, why isn't there a serious movement for an amendment that would more narrowly define eminent domain powers?

SB: There's already discussion of doing so. And, as I said, this is a time to really think big about these issues because it's clear that a narrow majority of the Supreme Court has given the potential for businesses and local governments to work together to take people's land. And I think it was a real wake-up call to people that something has to be done about this. And hopefully we'll see some major changes.

Reason: How is this going to affect lower court decisions in other eminent domain cases, such as the Michigan Supreme Court's reversal of the Poletown decision last year?

SB: What's important to point out is that even the majority admitted that state courts are free to interpret their own provisions in a manner that's more protective of property rights. Thankfully, every state Constitution has prohibitions against private takings and a requirement that takings be for public use. And, only six states have held that economic development condemnations are Constitutional. Nine have held that they are not. And most states have not addressed it.

Reason: States that have ruled in favor include Connecticut, presumably?

SB: Connecticut, Kansas, Maryland, Minnesota, New York and North Dakota: Those are the states that have said that this is acceptable to their state constitutions. Nine states have said that it's not. And then, most states have not addressed it. So, state courts, when this issue comes before them, are free to give greater protections to property owners and hopefully stop this practice in their states.

Reason: Speaking of private economic development, the import of the decision has largely been seen as clearing the way for seizures for private economic development, but that's not really unprecedented. Even railroads were private endeavors. So are we seeing something new here or does this decision just affirm the status quo?

SB: It's very different from something like a railroad. A railroad typically follows a very narrow strip of land. Railroads and utilities are what are known in the law as something called common carriers. So even though they might be privately owned, they're really the equivalent of public bodies because everybody, the public, has an equal right to them. Everybody has a right to the utility line. And they're very tightly controlled by public officials, so they're really the equivalent of public bodies; that's why the court upheld them. Here, we're talking about ordinary private uses of land—taking somebody's home for a Costco, taking Church property to give to another private owner. That's why this opinion is so sweeping and it's so far removed from even what the courts did in the railroad cases, or even in the situations involving blight. Because even in those cases, the government had to show that there was some type of harmful condition to that land before it was justified for condemnation. Here, the court said, whatever land the developers happen to desire is up for grabs.

Reason: The irony is that we're in this period of resurgence for American cities. Most major cities are doing better now than they have in decades, and arguments about urban blight are hard to make. Given yesterday's lifting of the need to prove an area is blighted, how do you expect that to play out?

SB: I think it puts more and more properties up for grabs because here it will be dependent, not on whether or not the property is blighted, but whether it happens to be desired by private parties. So you're going to see people of less economic means, poorer folks, middle class folks who happen to live in the city and live in desirable neighborhoods that are going to be targeted by these types of takings. That's the real travesty of this, and that's one of the strongest points made by Justice O'Connor and Justice Thomas, that this is going to fall hardest on people of limited financial means. And it's going to be to the benefit of the wealthy and the government.

Reason: One of the disheartening aspects of this decision is that two of the four dissenters are not long for the court. Justice William Renquist is pretty ill and Justice O'Connor is said to be close to retiring. Do you have any predictions about how a change in the Supreme Court composition will affect property rights?

SB: Well, I don't know. These things are always hard to predict. Look at Justice Kennedy's track record on property rights. But this is also the case where you could have a member of the court who might be more from the left but come to a very different decision from what some of the more liberal members of this court decided. As I mentioned, there are a number of people who are concerned about civil liberties, concerned about decisions that affect the poor and minorities, who are outraged about this.

One point you hear from some people who are trying to defend this decision is that the government went through a planning process in this case, that this is part of a well-developed plan. The idea that having a plan and going through a planning process protects property owners in any way is completely disconnected from reality. I mean, every development in this country has a planning process. You can't just show up in an open field one day and say, "Well I'm here to build my office park." Everything in this country has to go through a process, has to be announced, has to have hearings; to think that this provides any protection for property owners who face the loss of their homes and small businesses is nonsense. And it shows how some members of this Court and some defenders of this policy don't understand how these things really pan out in the real world.

Reason: Can you give some examples of other eminent domain abuses among the 10,000 cases you guys have cited?

SB: I'll give you one primary example that's brewing in Long Branch, New Jersey right now, where a group of people want to hang on to their working-class beach homes. They've worked very hard to get their modest bungalows along the shore. These houses were purchased by working class folks in Newark and other places, and now many of the elderly residents live there full-time; these are their dream homes. And the City of Long Branch is just proposing taking these people's homes and transferring them to wealthier home-owners. They want to tear them down and build million-dollar condominiums for people right along the shore in northern New Jersey. And so it's a case of taking the property of poorer folks and giving it to wealthier folks, and using it for the same purpose. It's just a transfer of wealth between home owners. It's a classic example of eminent domain abuse and one that I think will be litigated in the very near future.

Reason: Is that going to be a new wrinkle, that the property is going to be used for the same purpose?

SB: Well, possibly. There are a number of ways to challenge these types of takings. And I'm sure there will be many issues that are brought up in that case and some of the other ongoing controversies.

Reason: Where are the real outrages happening? Is New London more typical, or is something like Washington, D.C.'s stadium grab a more characteristic situation?

SB: The problem is that there are so many examples of eminent domain abuse. It's hard to find one that captures it entirely. New London was a classic example of this, but there are several others as well. They typically fall under two categories: One is when the government takes land just simply to produce more tax revenue. That was the situation that was going on in New London. The other thing is what we call the abuse of blight laws. An example of that is a case we were involved in in Lakewood, Ohio, where the government used blight laws simply as a means to an end. They're not really concerned about conditions in the neighborhood; they simply want to have it declared blighted so they can get the property and transfer it to private developers. The criteria that the City of Lakewood used to get the neighborhood declared blighted included such things as that the homes were lacking central air conditioning, didn't have an attached two-car garage, or lacked full bathrooms. It was really a means to an end, and the abuse of blight laws is an ongoing controversy and also encompasses a lot of the examples we point to of eminent domain abuse.

The New York Times welcomed the Supreme Court's recent endorsement of virtually unfettered eminent domain powers as "a setback to the 'property rights' movement." The fact that the Times not only celebrated a defeat for property rights but felt a need to put the phrase in scare quotes speaks volumes about the left-liberal misconceptions that have been brought to the fore by the Court's decision in Kelo v. New London.

According to the Court, the Fifth Amendment, which allows the government to take property "for public use" provided it pays "just compensation," is a license to transfer any parcel of land from its current owner to someone the government thinks will make better use of it. "Under the banner of economic development," noted Justice Sandra Day O'Connor in her dissent, "all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded—i.e., given to an owner who will use it in a way that the legislature deems more beneficial to the public."

In an editorial headlined "The Limits of Property Rights," the Times called this decision "a welcome vindication of cities' ability to act in the public interest." It said the redevelopment plan at issue in Kelo, which involves leveling the Fort Trumbull neighborhood of New London, Connecticut, to make way for a conference center, restaurants, and shops, "may hurt a few small property owners," but "many more residents are likely to benefit if the city can shore up its tax base and attract badly needed jobs."

The collectivist logic here is worthy of a Soviet central planner: The government decides what "the public interest" is and allocates resources accordingly, without regard to the private plans of the individuals who happen to own those resources. It's OK if people are hurt in the process, because on balance the welfare of the group will improve.

For the Times, acting in the public interest includes reassigning property rights based on the government's determination of which owners will generate the most tax revenue and jobs. In New London, the public interest happens to coincide with the interests of Pfizer, which inspired the city's redevelopment plan when it decided to open a new research facility adjacent to Fort Trumbull. In New York City, the public interest happens to coincide with the interests of The New York Times, which used eminent domain to forcibly obtain the land on which it is building its new headquarters.

Mindful of the appearance that big corporations such as Pfizer and the New York Times Co. use eminent domain for their own ends, the Times cautioned that "eminent domain must not be used for purely private gain." But as O'Connor noted, "nearly any lawful use of real private property can be said to generate some incidental benefit to the public." If the Fifth Amendment requires only that a taking provide some such benefit, she wrote, "the words 'for public use' do not realistically exclude any takings."

The Times, even while mentioning its own abuse of eminent domain, conceded that O'Connor raised "a serious concern." But it called her fears "exaggerated," since "the majority strongly suggested that eminent domain should be part of a comprehensive plan."

So contrary to the alarming reports you may have seen, the government cannot simply force you to sell your home or business, at a price of its choosing, for the convenience of a developer, a big-box retailer, or some other politically influential land grabber. It has to have a plan first. Maybe.

The nonchalance of the Times regarding eminent domain abuse is of a piece with its derogation of property rights, which it sees as inferior to so-called human rights. (Try to imagine the Times running a celebratory editorial on "The Limits of Human Rights.") Yet property rights are human rights: Your ownership of your house stems from your ownership of your body and the fruits of your labor.

In this light, all rights are property rights, without which it would be impossible to exercise, say, freedom of religion or freedom of the press. How free would The New York Times be if people could occupy its offices at will?

Then again, since the owners of the Times have implicitly identified the paper's new digs as a "public use," perhaps they wouldn't mind.

You may think your home is your castle, but the Supreme Court decided it is just on loan from your friendly local government. The government can now bulldoze your home anytime it wants as long as the legally-required number of public hearings are held and politicians have some semblance of a plan for economic development on your land.

That's what any reasonable person reviewing the Supreme Court's recent decision in Kelo v. New London might think. Hundreds of local governments already take private property. The Supreme Court's ruling in the Kelo eminent domain case just gave them the rubber stamp they wanted.

Kelo involves a hardy band of home and business owners in the historic neighborhood of Fort Trumbull in New London, Connecticut. The city, acting through its redevelopment arm, condemned the homes and businesses to make way for new professional office buildings, swanky retail shops, luxury condos and apartments.

The city's "vision" for the neighborhood, local officials hope, will generate more tax revenue. The newer buildings, bigger tax base, and more revenue constituted a "public use" in their eyes - and the Supreme Court agreed.

Eminent domain is not a new government power. It's been around for centuries and is enshrined in the Fifth Amendment to the U.S. Constitution. What's new is the brazenness in which governments use it. Eminent domain is supposed to help governments when they need to provide a public use. In the past, building roads, acquiring land for schools and public buildings, constructing bridges and canals, or providing parks qualified.

In the mid-1980s, that changed when the Michigan Supreme Court allowed the City of Detroit to demolish a close-knit, working class neighborhood called Poletown to make way for a factory. The city condemned the properties, bulldozed the homes, and handed the land over to General Motors to build its plant.

The Michigan Supreme Court reversed its decision in 2004, but the damage was done. The decision unleashed a wave of condemnations, like New London's, that shoved long-time residents and businesses aside in the name of economic development.

"Promoting economic development is a traditional and long accepted function of government," Justice John Paul Stevens wrote in the Court's majority opinion on Kelo.

The Court says public use can now basically be interpreted as any function of government. Indeed, this is exactly what Justice Sandra Day O'Connor fears. "Today nearly all real property is susceptible to condemnation on the court's theory," Justice Sandra Day O'Connor wrote in her strongly-worded opposition to the ruling. "The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory."

Sound extreme? Consider the words of New London's lead attorney during oral arguments in the case:

Justice O'Connor asked if the city could condemn a Motel 6 and hand the land over to a Ritz-Carlton if the city thought the move would generate more tax revenue.

Wesley Horton, New London's attorney, replied, "Yes, Your Honor. That would be okay."

"So you can always take from A and give to B if B pays more taxes?" asked Justice Antonin Scalia.

"If they are significantly more taxes," said Horton.

A shopping mall or business complex will almost always generate significantly more tax revenue than private homes, meaning we are all at risk.

Sad is it may be, many people ignored eminent domain in the past because it seemed to apply mainly to the poor—removing so-called "urban blight". The poor have always been at a disadvantage because they were renters or couldn't afford attorneys to fight city hall. Now, eminent domain is removing the middle class. Only the rich may be safe from the government bulldozers.

Private property rights were once a hedge against government corruption and abuse. This protection was so essential the Founding Fathers explicitly limited its use to special circumstances - public uses only - and required "just compensation" be provided to homeowners.

Now, there appears to be few "rights" left in private property rights. The U.S. Supreme Court just told every city, county, and state government that they can go after your home to increase revenues. The Court even put it in writing.

Dr Samuel R. Staley (sam.staley@reason.org) is Director of Urban and Land Use Policy at Reason Foundation and co-editor of the book Smarter Growth: Market-Based Strategies for Land-Use Planning in the 21st Century (Greenwood Press). He is also the author of the report "Study: Eminent Domain, Private Property and Redevelopment"  available online at:www.rppi.org/ps331polsum.pdf.

Key leaders of both parties in both chambers of Congress vowed today to use the power of the purse to negate this week's Supreme Court ruling allowing local and state governments to use eminent domain to take private property for economic development purposes.

Bills introduced in the House and Senate would yank federal funds from any city or state project that forced people to sell their property to make way for a project like a hotel or strip mall.

The 5-to-4 Supreme Court decision on Monday, the last day of the term, has sparked an immediate and visceral backlash among conservatives. The response on Capitol Hill was unusual for its speed and bipartisan support, and for the biting language the lawmakers used to criticize the high court.

House Majority Leader Tom DeLay (R-Tex.) said the planned intervention by Congress is part of a broad effort to "assert the responsibility and the authority of the Congress to be a check on the judiciary.

"Times have changed, particularly in the last two to three years," DeLay said during a rare appearance in the studio of the House Radio-TV Gallery. "This Congress is not going to just sit by  idly sit by  and let an unaccountable judiciary make these kinds of decisions without taking our responsibility and our duty given to us by the Constitution to be a check on the judiciary. And this is an example of doing that."

The ruling permits the "taking" of a home or neighborhood, with compensation, for such purposes as the construction of a shopping center. Activists said it has struck such a nerve that it will now be a key issue in convincing conservatives and libertarians to join the confirmation battle when one of the justices steps down.

House Judiciary Committee Chairman F. James Sensenbrenner Jr. (R-Wis.) said he will introduce a Private Property Rights Protection Act that will prohibit any state or municipality from using federal funds for any project in which economic development is used as a justification for exercising eminent domain.

"This decision, in my opinion, has the potential of becoming the Dred Scott decision of the 21st century," Sensenbrenner said. He was referring to the 1857 ruling that affirmed slaves as property without the rights of citizens, and was overturned when the 14th amendment was ratified in 1868.

A committee description said the locality or state would "lose any federal funds that would contribute in any way to the project the property would be taken for." The lead Democratic sponsor is Rep. John Conyers Jr. (Mich.), ranking minority member of the Judiciary Committee, and the committee said at least two other Democrats are co-sponsors.

Sen. John Cornyn (R-Tex.) is introducing a similar measure in the Senate, along with Sen. Bill Nelson (D-Fla.). Their measure  the Protection of Homes, Small Businesses and Private Property Act  relies on the authority of the legislature to regulate the use of federal funds, and declares the view of Congress that "the power of eminent domain should be exercised only 'for public use' " and not "to further private economic development."

Sensenbrenner said at the news conference that the federal government's money "will not be used to finance taking somebody's property from them to build a strip mall or a hotel or something simply because more tax revenue will come in as a result of an improvement." He said the decision, Kelo v. City of New London, "shows that the majority of the court had an utter disrespect for private property."

DeLay said as he left the news conference that he views the legislation as part of the review of congressional oversight of the judiciary that he requested after the death of Terri Schiavo, a Floridian who died March 31 after her feeding tube was removed despite congressional intervention to establish her rights in federal court.

"People are starting to understand what we've been talking about for the last two to three years," he said.

House Minority Leader Nancy Pelosi (D-Calif.) said at an earlier news conference that "very central in that Constitution is the separation of powers."

"When you withhold funds from enforcing a decision of the Supreme Court, you are in fact nullifying a decision of the Supreme Court," Pelosi said. "This is in violation of the respect of separation of powers in our Constitution  church and state as well. Sometimes the Republicans have a problem with that, as well."

In opposing a Republican amendment about the issue today, Rep. David Obey (Wis.), ranking Democrat on the House Appropriations Committee, said on the floor today that the decision was "nutty" but that the solution is legislation or a constitutional amendment, not punitive measures.

"The idea that this House, every time we don't like a court decision, should decide that we're not going to allow federal money to be used to enforce that court decision is as nutty as the original court decision in the first place," Obey said. "So I would hope that we would recognize that the Founding Fathers created the system of separation of powers. They created three independent branches of government for a purpose."

6/30/2005

The Institute for Justice and its grassroots group, the Castle Coalition, seeks to do what the U.S. Supreme Court refused to do last week when it issued its ruling in the Kelo case allowing eminent domain for private development: protect ordinary homeowners and small businesses from eminent domain abuse.

Through IJ’s Castle Coalition - a nationwide network of citizen activists determined to stop the abuse of eminent domain in their communities - the Institute for Justice today announced the “Hands Off My Home” campaign to give ordinary citizens the means to protect their homes from government-forced takings for private development. The Institute also made an initial commitment of $3 million to fund the national effort to combat eminent domain at the state and local level. IJ made the announcement less than one week after the U.S. Supreme Court issued its Kelo decision allowing governments to take property from the rightful owner only to hand it over to another private party for his or her private gain.

“The floodgates to eminent domain abuse are already opening in the wake of the Supreme Court’s dreadful Kelo decision,” said Scott Bullock, senior attorney for the Institute for Justice. “The Hands Off My Home campaign will empower ordinary Americans to fight back against eminent domain abuse and to stop this un-American alliance between tax-hungry politicians and land-hungry developers.”

“The American people are furious about this decision, but they can do something about it,” said Dana Berliner, an IJ senior attorney. “In this next year, the Castle Coalition will encourage and coordinate grassroots efforts to end eminent domain abuse in states and cities. At the same time, the Institute for Justice will ask state courts to enforce their state constitutional limits on the use of eminent domain for private development. And the next time we get to the Supreme Court, it will overturn the Kelo precedent.”

“One would be hard-pressed to think of a recent Supreme Court decision that has generated such widespread and virtually unanimous outrage,” said Chip Mellor, the president and co-founder of the Institute for Justice. “We will take this energy and put it toward productive activism.”

As part of their Hands Off My Home campaign, the Institute for Justice and the Castle Coalition’s immediate plans are to:

Pursue state-level litigation to enforce the “public use” limitations found in every state constitution.

Today issue a formal pledge for governors in each state to sign promising to oppose efforts in their states to use the government power of eminent domain for private development, and to support legislation and other efforts to ensure that citizens of their state are safe from eminent domain for private development. IJ and the Castle Coalition will soon extend this pledge to legislators and city officials nationwide.

Support citizen activists nationwide who are urging their state and local officials to set stricter standards for the use of eminent domain.

Establish a Castle Coalition presence in every state so ordinary citizens will be poised to mobilize the minute eminent domain is abused for private ends. Citizens can join the Castle Coalition at www.castlecoalition.org.

Host a conference in July in Washington, D.C., to train activists in fighting unjust takings.

Bullock said, “We’ll be working across the country, but we’re not giving up on New London, Conn. On July 5 at 6 p.m., there will be a rally at the New London Town Hall to ask the City Council to save these homes and allow Susette Kelo, the Dery family and the rest of the homeowners to stay in Fort Trumbull. The City and the New London Development Corporation don’t need these homes to accomplish their private development projects, and we will ask them to finally do the right thing and let these people stay in the homes they know and love.”

Steven Anderson, the coordinator of the Castle Coalition, said, “Many cities held off on eminent domain actions, waiting for the Supreme Court to decide Kelo. Now, with a thumbs-up from the Court, these cities can be expected to move aggressively. Some already have. But IJ will be there every step of the way to stop eminent domain abuse.”

Among many such examples of this trend, Anderson cited officials in Freeport, Texas, who immediately began legal filings to seize small businesses to make way for a private boat marina.

Among the small property owners who addressed the press conference was Scott Mahan from Ardmore, Penn., who may lose his small business to government-forced redevelopment. Mahan said, “Anyone who owns a piece of property anywhere in this country is at risk after the Kelo decision. Now people are finally seeing that this isn’t just homeowners in New London, Connecticut, or business owners in Ardmore, Pennsylvania; it can happen to anyone, anywhere.”

Denise Hoagland, a homeowner from Long Branch, N.J., who is fighting to save her ocean-front home from a private development project that would replace her home with upscale condominiums, spoke for many homeowners nationwide who are fighting this kind of abuse when she said, “My home is a part of me, a part of my family, and we are part of a community. Owning a home is the American Dream and to have it forcibly taken away to benefit someone else is against all of the principles of what being an American is about.”

6/29/2005

To many, the headlines about Thursday's Supreme Court decision in Kelo vs. City of New London - "Court Authorizes Seizure of Homes" - must sound un-American. But in upholding a city's right to take private property as part of an economic redevelopment plan, the court affirmed principles as old as the Constitution.

There should be no doubt that the Constitution permits the government to take private property without consent in some instances. The very same provision of the Constitution that protects the right to private property - the Fifth Amendment - also provides that the government may "take" private property for "public use" so long as it pays "just compensation." That does not mean the government may act like a thief. Thieves do not have to get public approval to take property they don't own. And they don't have to pay compensation for what they take. Governments must do both to comply with the Constitution.

The founders made a wise choice in permitting government to take private property without consent. From laying railroad tracks to building highways, the government often needs to assemble large amounts of land to provide common benefits. Indeed, the property owners in Kelo no doubt benefited from past takings that permitted government to build roads and highways connecting New London, Conn., to state and national markets.

But does that mean the government can take property for any reason? What about the Constitution's requirement that takings must be for a "public use"? New London was not building a public highway or a governmental building. It was clearing land for offices and shops and new homes. How is taking land for private development a public use?

The answer lies in history. Since before the Civil War, courts have recognized that government sometimes must enlist private actors to make "public" use of land it seizes. States, for example, often let railroads condemn private land to create their routes. The government required railroads to act as common carriers in return, but it did not prohibit them from operating as private companies. Passengers still had to pay to ride. But courts treated the railroad's private use of the seized land as "public" because of the obvious benefits of increased rail travel.

It's not surprising that courts look favorably upon such public-private partnerships. The government has no monopoly on knowledge when it comes to market matters. But if public/private partnerships were permissible in the early years of industrial America, they should be no more objectionable today.

New London was attempting to retrofit itself for a rapidly globalizing economy. It was reclaiming its waterfront for a new urban era and capitalizing on new business development. Such efforts would benefit private developers. But they also would benefit the city and the state. Or so thought the city council - backed up by the state's authorizing legislation, and state dollars supporting its redevelopment plan. The court concluded it would follow the wise counsel of previous courts, and defer to the economic policy choices of the people's representatives.

But if the court showed that admirable deference, it also rightly backed away from statements in some earlier opinions that sounded almost like abdication. Kelo now makes it clear that the government must engage in a sincere effort to benefit the public. The court issued a warning to cities contemplating "a one-to-one transfer of property, exercised outside the confines of an integrated development plan" and aimed solely at boosting the property tax base. Such action, the court suggested, "would certainly raise a suspicion that a private purpose was afoot."

And the court also opened the door to a reconsideration of what constitutes "just compensation," noting the special hardships faced by the property owners on the wrong end of the court's holding.

Important as those caveats are, though, Kelo's real significance lies in its broad view of local planning power. As the era of urban renewal reveals, things can go awry when cities join with private developers to remake "distressed" neighborhoods. But those risks may at least be addressed through politics.

The Supreme Court empowered cities to confront the next phase of urban development with imagination and energy. One hopes they will prove worthy of that confidence.

The adage that no man's property is safe when the Legislature is in session should be amended to include the U.S. Supreme Court, given last week's ruling that state and local governments may use eminent domain to take private property and convey it to a private developer to spur economic development.

The case originated from Connecticut but in New Jersey, where a handful of extremely powerful, well-connected developers seem to be able to get whatever they want, the decision is particularly disconcerting. The news, however, is not as bad as it appears.

The ruling will not carry much weight in this state, where homeowners are protected by legislation and the state constitution.

New Jersey law limits the use of eminent domain to blighted areas. That doesn't mean your property is completely protected. Apparently, one man's happy homestead is another man's blight.

The definition of blighted, which includes any property that is substandard, unsanitary, dilapidated, long-vacant, obsolete, not fully productive or damaged by fire, is so vague it invites abuse. Take Long Branch for example. There, 36 long-time, middle-class homeowners are being driven out to make way for a luxury condominium development. The homeowners there don't think their properties are blighted.

In Lodi, residents of a trailer park are facing the prospect of being displaced to build a gated senior citizen community with 250 housing units and retail shops. By getting rid of the trailer park, municipal property taxes on the parcel of land will jump from $250,000 to $3 million a year. And, it doesn't hurt that the builders are generous political contributors to both parties and include the brother of state Sen. Paul Sarlo (D-Bergen).

But New Jersey property owners must remain vigilant. As Justice Clarence Thomas so aptly pointed out, in his dissenting opinion, people who live in poor communities with the least political clout are the most vulnerable.

Eminent domain can be a great boon. It can clear the way for phenomenal, much needed redevelopment, but it also can be abused. Whether it is will depend on local officials, who were granted broad powers by the courts, and ultimately by voters

Never have I been as outraged  and depressed  with government as I am with the recent U.S. Supreme Court decision condoning the taking of private property for private use.

During my 11-year term as a professor of real property law, my law students and I frequently discussed the cases that proceeded to erode the mandate of the Fifth Amendment  that government shall take no private property for public use without just compensation. I'd like to share, in non-legalese, some of these thoughts, the history that led up to the court's ruling and what we can expect if we sit complacently on our civil rights.

The undermining of the Fifth Amendment began when the courts reinterpreted the word "public" to mean "governmental" and the word "use" to mean not just a measurable land use but an amorphous "purpose." Condemnation was thus permitted for a governmental building, not just a public park or road. From these decisions, our legislatures, with the approval of our courts, then proceeded to destroy the mandate of our 10th Amendment  that government shall only legislate to benefit the public health, safety and welfare. It was a simple matter. All they had to do was interpret the phrase "public welfare" to mean the "public economy" and thus the "governmental tax base." The rationale was that these constitutional erosions were authorized by the public under the theory that we have, at all times, government of, by and for the people.

But this was not the most serious and insidious erosion of our Constitution. Until the U.S. Supreme Court ruling of June 23, the worst erosion was the shameless violation of our 14th Amendment which prohibits legislation that results in discrimination based on wealth or poverty. How often have we observed the condemnation of whole areas in our city due to "economic blight"? How often have we heard the local legislative pronouncement of "urban blight," a judgment call made without fixed and equitable standards, which discriminates against area residents and small business owners because of their collectively small bank accounts.

Unfortunately, I don't believe that we've yet seen the worst. Taking private property for private use  your business or my home  won't hold a candle to the day when we see private personal property as well as real property  your automobile and my cat  taken because they constitute blights to our neighborhoods. And just wait until government sees no need to compensate us for either the personal or real property they take. Indeed, it already does this by reinterpreting the word "taking" to mean mere "regulation," for which no compensation need be paid. Prime examples of regulation are downzoning or removing trees that allegedly obstruct the views of drivers.

For the time being, it seems that government would prefer that we keep our mouths shut, that we relinquish our First Amendment rights to freedom of speech, press, religion, and certainly, our right to petition government. If we speak out, our legislators might retaliate and take whatever they will from us, even without unjust compensation.

We are the public, the people, the government, and we must preserve our property rights in every way we can. We cannot permit our state to adopt these new federal standards. We cannot allow our county and city to deprive us of our right to life, liberty and property by following suit. We cannot afford to look elsewhere when we see the camel's nose poking through our neighbor's tent, lest our own campground be overrun and ruled by camels.

Imagine the city or state taking your private property because it felt someone else could use your land more profitably. The U.S. Supreme Court last week ruled that government has that authority through eminent domain.

But local politicians sent a message Monday that that is not OK.

“To the Supreme Court of the United States, the Anchorage Assembly should say, ‘Thanks, but no thanks,’” said Assemblyman Allan Tesche.

He and fellow Assembly member Janice Shamberg (left) say they will introduce an ordinance at Tuesday’s meeting to limit the city’s power of eminent domain.

“It's just not worth that price,” said Shamberg. “You don't pay that price, taking away a private person's property and giving it or selling it to another person or another entity because they can do better with it.”

The U.S. Supreme Court decision came on a case from Connecticut, in which the court ruled 5-4 that the city of New London can take private property for the simple reason of economic development.

Anchorage Assembly members are not the only politicians speaking out against the ruling.

“It’s a case of judicial theft,” said Anchorage Rep. Bob Lynn. He and fellow Republican Rep. Lesil McGuire are drafting a bill to limit the state’s power of eminent domain.

“We want to have a bill that’s going to protect Mr. and Mrs. Alaska,” Lynn said. “We don't want to have somebody coming in and trying to put a big box store in somebody's bedroom so they can increase the tax revenue. That just doesn't make any sense at all.”

Eminent domain is most commonly used in public works projects. Recently, the state Department of Transportation used it for the C Street extension between Dimond and O’Malley roads.

Three property owners out of approximately 50 refused to sell their homes, so the state invoked eminent domain. Ultimately, the property owners agreed to sell.

If the new legislation passes, the power would still exist. But the politicians say that taking private property just to sell it to another developer will not be allowed.

“What we would like to do is provide a clear, strong and immediate reassurance to Anchorage citizens that this power will not be exercised here,” said Tesche.

Even without the ordinance, the likelihood of that happening in Anchorage is remote. But Tesche said it’s a way to ease public concerns that the government could use the court’s ruling to grab land.

Officials say the last case of eminent domain used by the city was in 1999 on the widening project along 15th Avenue. In that case, it acquired part of a parking lot belonging to the Black Angus Inn.

In another 5-4 decision, a majority of the U.S. Supreme Court seems to have given priority to an expansive, new definition of the Fifth Amendment's public use clause over private property rights.

The traditional understanding of public use involved building the streets, sidewalks and public utilities that are part of the civil infrastructure. In 1954, the high court expanded that understanding to include government takings for economic and aesthetic purposes.

In its ruling last week in Kelo v. City of New London, the court established a new and dangerous precedent. It allows the government to exercise eminent domain and transfer title to private entities, all in the name of economic development and generating a larger tax base.

In theory, this places nearly every private property owner at risk. Since businesses generate more economic activity and taxes than residences, municipalities could take homeowner property in order for commercial interests to move into residential neighborhoods, as is the case in New London, Conn.

But it doesn't stop there. Large businesses generate more jobs and tax receipts than small businesses. And the higher up the economic ladder you go, the more access and influence business interests have on the political process.

Americans should not have to fear being dispossessed by individuals and business interests wealthier and better connected than they are.

TIM SANDEFUR: I'm an attorney at a conservative legal organization called the Pacific Legal Foundation. I filed a couple briefs in the big eminent domain case, and I was very impressed this morning how you got this case exactly right. This is not about states' rights. This is about massive corporate welfare programs to take property away from poor people and give them to Costco and IKEA and Home Depot and other big powerful corporations, and it was blessed by the liberals on the court. And this is what happens any time private property rights are denigrated. Back in the 1930s, the court said they didn't really care much about property rights because they wanted the government to take property away from rich people — and it was only a matter of time before rich people like these companies figured out how to use that power for their own benefit, and that’s okay for the liberals.

RUSH LIMBAUGH: I can't add to it other than thank you for your comments. The thing that surprises me about this, though, is how some people actually think this is a victory for states' rights and for local government rights, because they're not fully aware of just what happened here. But let me ask you, since you're out in the west: What's the complication here for other private property rights when it comes to environmentalism, such as — we all know the big cases, the kangaroo rat down in Bakersfield, and the guy losing his farm as wetlands. All these Supreme Court cases have echoes. What's the echo going to be for people out west on something like that?

TIM SANDEFUR: Well, down in San Jose here they're condemning property to leave it as open space. They take away property and leave it to the animals. Of course not only does that mean that you can't build on your property, but that means that the tax base for the remaining people in the city, their tax burden goes way up because now there's more untaxable property, and this is happening all over the country. In five years between 1998 and 2003 there were 10,000 reported cases across the nation of eminent domain being used to benefit private parties or threatened to be used for the benefit of purely private parties for their own private profit. The Constitution says you can only take property for public use and now the Supreme Court said that anything that benefits the public is a public use.

RUSH LIMBAUGH: Yeah, but the way the states are getting around it is very crafty. Well, they're not getting around it. What they're saying and the way they're spinning is that you can take anybody that is a major property developer. They're going to be paying more property tax than these little small fry homeowners such as in New London Connecticut, and that's used to justify it.

TIM SANDEFUR: Of course. Well, the problem with that is that anybody's house can be more productive if it were turned into a Costco, and the Constitution says "public use." It does not say "public benefit," because the everything can be somehow described as a public benefit. If you take somebody's home and turn it into a public park or if you take somebody's home and turn it into a Costco or if you take somebody's home and just give it to, say, a group of homeless people.

RUSH LIMBAUGH: Yeah.

TIM SANDEFUR: I suppose that benefits the public, but that's not private property rights because it's not public use, which is what the Constitution specifically says.

RUSH LIMBAUGH: Precisely. It's just the government choosing Citizen A over Citizen B.

TIM SANDEFUR: They're going to choose the most politically influential group instead of poor people or people like Susette Kelo, a nurse who is working three jobs to cover her housing payment there in New London, Connecticut. She's now being thrown out of her house to give to a convention center because that will improve the tax basis and allow the politicians to spend more tax money.

RUSH LIMBAUGH: But the thing people have to understand about this is, in my view anyway, is that we hear all this talk about Democrats and liberals being for the little guy, and this court, the liberals on this court found for government — and whenever it's government versus the guy, little guy or big guy, they're going to find for government either way around. They did in this case. It looks like they're finding for Citizen B but actually what's going on, they're finding for themselves because they're going to get more tax revenue out of this.

TIM SANDEFUR: They're finding against private property rights because if this court says the government had no right to take property from one person and give it to another, why, 90% of the government would be fired tomorrow because that's what government does all the time. In every facet of its operations, it takes property from some people and gives it to others and that's not what the Founding Fathers intended. They required that government abide by strict limitations, and those have eroded over the past 70 years and so it's no wonder that wealthy corporations figured out how to exploit government's power to take people's property for their own benefit. If I had the power to lobby govemment I might do the same thing, and take the White House and make that my private residence, and claim it's for the public benefit.

RUSH LIMBAUGH: Hang with me, Tim, because I have one more question for you, but first I must say, "I hope you liberals listening to this program," and I know you're there and you know who you are. I hope you're noting two conservatives railing against big corporate interests.

TIM SANDEFUR: That's exactly right.

RUSH LIMBAUGH: You just normally don't hear that. You really don't associate the two. Normally it's the left you hear wailing and moaning against big corporate interests.

TIM SANDEFUR: But Rush, the reason for that is that conservatives recognize that private property rights should be respected for everybody. The poor man should have his house respected and the rich man should have his house respected, and the only way you can have a safe and free society is if you have a government that respects everybody's property rights equally and leaves them alone.

RUSH LIMBAUGH: There's an added element to it and that is the importance — maybe even of more importance than the right to free speech — of the right to own property in a free country. Without the right to own property even with the right of free speech you don't have a free country not when the government can come in and take whatever they want whenever they want it, not pay you anything for it or very little for it and give it to somebody else or use it themselves.

TIM SANDEFUR: You can't even have freedom of speech if you don't have private property rights, because the government can retaliate against you for expressing your opinion by taking away your property. Private property dghts are the most important of all rights because they are the ones that protect every other right.

RUSH LIMBAUGH: Which is why it was specified in the Fifth Amendment of the Constitution. Now, my other question. There was a ruling last week, the first of these private property rights rulings, involving a hotel in San Francisco.

TIM SANDEFUR: That's right, San Remo Hotel. Our foundation was also involved in that case. That case says that now you have to go to state court first with any kind of taking claim — and of course you're going to lose because the state courts are made up of politicians who are appointed by a governor who is in favor of taking away your property to begin with. Then, once you lose in state court you've out of luck. You can't go to federal court because the federal court will say, "You already heard your case in state court." That's not what the system was meant to do. You're supposed to have a federal avenue whenever your property rights are deprived.

RUSH LIMBAUGH: True, but I need more information on the specifics of this case.

TIM SANDEFUR: Rush, it's a terrible case.

RUSH LIMBAUGH: Here's what I know. I know that you had a hotel, and most of its rooms were not rented to vacationers and tourists but for long term residents. And the hotel decided they wanted to change the way it was doing business. They wanted to convert most of these rooms to traditional hotel use.

TIM SANDEFUR: And the city sid no. I you want to do this, you have to pay this extortionate fine to the city that we'll use for public welfare programs or something like that.

RUSH LIMBAUGH: And they said you can't do it because we have to have so much guaranteed low income housing in the city, right?

TIM SANDEFUR: That's right, exactly. They shifted the cost of the homeless problem onto this private hotel owner rather than taxing everybody equally to pay for the program. This was a blatant violation of private property rights, and the California Supreme Court, except for the great Justice Brown who now is on the DC Circuit, upheld that and said that's perfectly all right.

RUSH LIMBAUGH: She called it thievery.

TIM SANDEFUR: Out-and-out plan of extortion, exactly.

RUSH LIMBAUGH: So essentially the San Remo Hotel in San Francisco was told, "No, you cannot use your property as you choose. You've gotta use it as the city mandates or you're going to pay through the nose."

TIM SANDEFUR: And as Justice Brown pointed out what that means is that private property is really just a scheme that the government used to raise money for its welfare programs. It used to be that private property was yours and the government existed to protect it. But now private property is just like a farmer who leaves a chicken in its coop and leaves it a few eggs so that it will lay a few more eggs for his own benefit. That's what private property is like in America today, because the government sees it as just a clever mechanism of creating wealth that it can then go and redistribute.

RUSH LIMBAUGH: Now, would you say that like a lot of people live in areas where there are tremendous town and city regulations, not just zoning, but where you can build your house, how high it can be, what color it can be, would you say that that is an example of encroaching loss of private property dghts?

TIM SANDEFUR: Oh, yes, many of these regulations deprive people of the value of their property. Sure, they don't take the full value; they don't take the actual title document but the government passes laws that deprive people of almost the entire value of their property. You know, Pacific Legal Foundation did a case called Palazzolo some years ago where Mr. Palazzolo bought some land in Rhode Island and he was gonna build some luxury condominiums on it and retire off that money and the state came along and passed a law saying, "You can build one house on that property, and that's it," and the Supreme Court said, "Well, that's not a taking of this person's property." They took 99% of the value of his property but because they didn't actually take the title deed document. That's just a sham. It's just a shell game designed to protect government welfare programs at the expense of private property dghts.

RUSH LIMBAUGH: What can little people do?

TIM SANDEFUR: What needs to be done is state constitutional reform. We need amendments in all of the state constitutions that prohibit the taking of private property for private use. Arizona and Washington already have these provisions. Other states need to get them. We need one here in California, very badly, that says: "Private property shall not be taken for private use."

RUSH LIMBAUGH: This is what frustrates people, though, Tim. The Constitution already says that. The US Constitution already says it but because we've got some people in robes that aren't going to read it that way we gotta do it all over again, and some people just throw up their hands and say, "Well, it's never going to happen to me. I don't care." Most people will say, "That's not going to happen to me. I'm not going to get involved. I've got other things to do."

Gov. Matt Blunt said Monday he'll name a special, nine-member task force to study federal and state eminent domain laws.

Those laws allow governments to condemn and pay for private property when there's a strong public policy reason.

The governor's announcement came four days after the U.S. Supreme Court ruling last week against homeowners in Connecticut, who wanted the court to prevent their homes from being taken by a private developer for a commercial project.

"This is a terrible ruling that undermines the balance that ought to exist between private property owners and the needs of the public," Blunt said in a news release. "I am charging this commission with conducting a thorough review of federal and state eminent domain laws to protect Missouri home, farm and business owners from falling victim to a government tax grab."

Blunt said his Missouri Task Force on Eminent Domain also will be charged with issuing criteria to be applied by state and local governments, when eminent domain is being proposed.

The task force also is to recommend any needed law changes for protecting private property owners.

"I believe eminent domain can be an appropriate tool under certain circumstances," Blunt said. "But it should not be used as a means to take property from responsible owners when no clear public interest exists."

Terry Jarrett, Blunt's general counsel, will serve as chairman. The panel will exist only until Dec. 31.

Could a hotel be built on the land owned by Supreme Court Justice David H. Souter? A new ruling by the Supreme Court which was supported by Justice Souter himself itself might allow it. A private developer is seeking to use this very law to build a hotel on Souter's land.

Justice Souter's vote in the "Kelo vs. City of New London" decision allows city governments to take land from one private owner and give it to another if the government will generate greater tax revenue or other economic benefits when the land is developed by the new owner.

On Monday June 27, Logan Darrow Clements, faxed a request to Chip Meany the code enforcement officer of the Towne of Weare, New Hampshire seeking to start the application process to build a hotel on 34 Cilley Hill Road. This is the present location of Mr. Souter's home.

Clements, CEO of Freestar Media, LLC, points out that the City of Weare will certainly gain greater tax revenue and economic benefits with a hotel on 34 Cilley Hill Road than allowing Mr. Souter to own the land.

The proposed development, called "The Lost Liberty Hotel" will feature the "Just Desserts Café" and include a museum, open to the public, featuring a permanent exhibit on the loss of freedom in America. Instead of a Gideon's Bible each guest will receive a free copy of Ayn Rand's novel "Atlas Shrugged."

Clements indicated that the hotel must be built on this particular piece of land because it is a unique site being the home of someone largely responsible for destroying property rights for all Americans.

"This is not a prank" said Clements, "The Towne of Weare has five people on the Board of Selectmen. If three of them vote to use the power of eminent domain to take this land from Mr. Souter we can begin our hotel development."

Clements' plan is to raise investment capital from wealthy pro-liberty investors and draw up architectural plans. These plans would then be used to raise investment capital for the project. Clements hopes that regular customers of the hotel might include supporters of the Institute For Justice and participants in the Free State Project among others.

Illegitimate Eminent Domain takings have been happening for years with highway construction and the public has paid a dear price for it. The way this has happened is by gradual replacement of traditional accounting mechanisms to balance user tax coming in with maintenance and construction costs going out. Decades ago, it only required accountants to monitor the activities of a highway department. Now economists have taken over. Instead of viewing a good project as one that promoted public safety, mobility and was financially sound, the new think is to make sure the ratio of money spent is somewhat in the neighborhood of the increase in the land values that result in the construction. Instead of replenishing the highway trust fund, the construction is expected to replenish local sales and property tax collections.

To many people, this sounds reasonable, but it has a negative impact on safety, mobility or congestion and economic stability of state trust funds. If you are driving to work along a route that already has high value land to the left and the right, it is less likely that your route will be considered as a good candidate for economic development purposes. In fact, the money that you put in the purchase of gas or other fuel is probably going to go somewhere else long before it solves your congestion problem.

In Tennessee, the state highway department is pushing highways that have much lower potential for recovering the initial investment but have high value with respect to the ratio of the cost of the construction to the increase in land values. The public is often told that the highways, though underutilized, are safer, and they are, but if they were built in more urban settings, they would be safer for a much larger fraction of the population. Even though cell phones, speeding and seat belts are a factor in highway safety, the state highway departments are more likely to press against these causes of highway deaths and damage rather than their own failings to produce a product that obtains the greatest good for the greatest number.

Few people will question the taking of private property for a highway because they are familiar with the usual situation where the public at large benefits from the taking. The assumption of universal benefit is no longer applicable when the motive behind the taking is an extra interchange to serve a large retailer.

These "extra" interchanges often come with lowered speed limits and higher accident frequency. For this reason, I say that the taxpayer is paying with life and limb as well as providing an incentive to raise gas taxes to cover the losses. To perpetuate an interstate, it can take as much as 44,000 cars per day. Some of these interchanges and their connecting roads have from 4,000 to 12,000 cars per day. The losses must be absorbed elsewhere in the system.

Corporate welfare programs, better known as Economic Development are the darlings of the left and the right. For one group, it seems to prove that taxes are too high and for the other group it proves that the economy needs fixing. In Tennessee, a state sponsored county by county organization is ready, willing and able to go after anything to make a job. The justifications can not be challenged when they come in the form of reports from economist who use high dollar computer programs and high dollar purchased data to run the program. The output and the degrees that are wielded plus good intentions is adequate anesthesia for most people, so they regard the process as legitimate.

Ratner’s So-called “Community” Benefits Agreement Bypasses Community and Local Elected Officials "CBA" is Insufficient Band-aid on a Fatally Flawed Development Proposal and Process

Four days after a sharply divided Supreme Court decision, perceived to give a green light to Forest City Ratner’s (FCR) use of eminent domain for its private, for-profit, 20 high-rise and arena development proposal in Prospect Heights, Brooklyn, the developer announced a so-called Community Benefits Agreement (CBA) with eight signers.

“There are 48 known community organizations (see list below) and three of the district’s four elected officials who are opposed to or very deeply concerned about the FCR proposal,” said Develop Don’t Destroy Brooklyn (DDDB) spokesman, Daniel Goldstein. “None of these groups have been involved in the ‘CBA’ negotiations, while all of the groups that have been involved have supported the project from the beginning. Those most directly affected by the proposed project have not been involved either. What was announced today may be an agreement, but it is patently not a community agreement.”

The “CBA” concerns itself, primarily, with jobs and housing. Any developer who builds on the Atlantic Yards should negotiate with the community. However this “CBA” is extremely weak and lacking because it has excluded all the concerns that deal with community quality of life which will effect everyone in the area: building scale, character and density, land use, secondary displacement, eminent domain, environmental impact during and after construction, health issues, project urban design and serious traffic and transportation issues–even though these are major concerns of the five communities surrounding the proposed development site. The State approval process also includes no genuine opportunity for community input.

The Ratner “CBA’s” very foundation is in violation of a key principle of effective CBAs–they are meant to be the end result of a negotiation process between the developer and a wide spectrum of community groups opposed to, and supportive of, a development proposal. But in this case, all oppositional and most longstanding community stakeholder groups were excluded from the outset.

“An insufficient band-aid like this 'CBA' does not cure any of the ills of the Ratner proposal or make up for the utter lack of an accountable, democratic process. A ‘community’ benefits agreement that excludes most of the community, ignores serious impact concerns, is negotiated behind closed-doors, and accepts eminent domain that disrupts the bedrock foundation of communities–homes and businesses–is dangerous and destructive to communities,” Goldstein concluded. “And the timing of the Ratner ‘CBA’, on the heels of the Supreme Court’s Kelo decision–a decision that raises serious questions about the legality of using eminent domain for the FCR project–leads us to believe that Mr. Ratner is not intent on genuinely engaging the community but would rather steamroll it with his $1.6 billion taxpayer subsidized, sweetheart deal.”

For more information on CBAs–Community Benefit Agreements: Making Development Projects Accountable by California Partnership for Working Families and Good Jobs First, click here:

6/28/2005

Expressing concerns about a U.S. Supreme Court decision that broadened governments' rights to use eminent domain proceedings to take private property, Florida House Speaker Allan Bense on Friday created a committee to develop guidelines about when and where the proceedings can be used in the state.

The action follows Bense's vote two months ago in support of a state subsidy for a new Florida Marlins stadium, a project that may displace about 100 Miami residents through eminent domain proceedings. The project ultimately did not receive the state subsidy.

Bense also tapped Rep. Marco Rubio, R-Miami, one of the strongest and most vocal supporters of the Marlins stadium, to head the committee. In a statement, Bense said he was "extremely concerned" by the court's 5-4 decision Thursday, which critics say weakens individuals' property rights at the expense of private projects that are intended for public use.

Bense, who has described himself as a libertarian in opposing government intrusion on personal lives, said Floridians should be wary of eminent domain proceedings used to benefit profit-driven private entities.

"Private property rights are a fundamental principle upon which our nation was founded, and government should only be allowed to deny a United States citizen those most basic rights under the most extraordinary circumstances," he said.

Bense's spokesman said Friday that his support of a $60 million subsidy for the Marlins stadium and his selection of Rubio as the committee's chair are not contrary to his concern about the Supreme Court opinion.

"There are distinct differences between the Marlins situation and the Connecticut case," Towson Fraser said.

In the Supreme Court case, seven Connecticut homeowners lost their bid to fight off an eminent domain proceeding that would raze their homes to construct private commercial development. In the case of the Marlins, the team, Miami-Dade County and the city of Miami are all contributing money for a stadium that will be owned by the county, then leased to the baseball team.

A bid to also add a 30-year, $60 million state subsidy to complete the financing package passed the House — with yea votes from Bense and Rubio helping it along — before it died in the Senate.

But Miami officials have promised to revive the fight, and Rubio could lead it when he becomes speaker of the House in 17 months.

Fraser said he did not think Rubio's support of the Marlins' stadium and his appointment to head the eminent domain committee represent a conflict of interest.

Hudson County [NJ] officials had mostly positive responses to Thursday's Supreme Court decision that secured the right of governments to use eminent domain for private development.

The power of eminent domain, which allows the government to seize land for greater public good, got a boost when the nation's top court ruled that the city of New London, Conn., could condemn well-kept homes and businesses and turn the properties over to a private developer.

The court determined that the prospect of a more vibrant city and a bigger tax base satisfied the constitutional requirement that land seizures be for a public use.

In recent decades in Hudson County, the power of eminent domain has been used to condemn or repossess properties in Jersey City and Weehawken to pave the way for development along the waterfront.

"The ruling will gentrify only those areas that directly need it," said Elizabeth Spinelli, director of Hudson Economic Development Corporation. "This is not for the benefit of a large corporation but for the benefit of the whole community."

However, Spinelli acknowledged the potential losses that can occur under this new ruling, including the forced closing of many small businesses.

With a more restrictive constitution than Connecticut's, New Jersey allows towns to seize only "blighted" property for redevelopment. But because the state Legislature defines that term broadly, some claim a growing number of towns are getting aggressive with their condemnation power.

Assemblyman Louis Manzo, D-Jersey City, has proposed a bill to limit the ability to seize properties.

"We are trying to jump the gun and level the playing field for smaller business owners," Manzo said. "We don't want people to jump to actions such as in Connecticut, where they repossessed perfectly good homes. In the future, someone may disregard the clause calling for a blighted area."

Michael O'Connor, the director of the Bayonne Economic Development Corporation, said his city is working on two redevelopment plans that might involve the repossession of small, privately owned businesses and homes.

"We're not trying to take people's businesses. Instead, we are trying to revitalize a key location in town," he said.

Jersey City Mayor Jerramiah Healy said the ruling could facilitate the redevelopment of Journal Square.

"The ruling will allow Jersey City to consider eminent domain for Journal Square properties," he said in a statement. "The way Journal Square development has gone in the last 20 years, the city could exercise its right to condemn these properties."

Communities won't be stampeding to the courts to use eminent domain to seize people's homes and businesses for economic development projects, even as a U.S. Supreme Court decision makes it easier for them to do that, some local government officials and developers said Friday.

Local governments still regard eminent domain as a last resort because it's a long, costly, painful process that's often politically unpopular, they said.

"The court decision is going to help the inner-ring suburbs and the central city revitalize themselves," said David Main, president of the Hamilton County Development Co., which runs the county's economic development department.

"But I don't think there's going to be a rush toward eminent domain."

Yet eminent domain critics say the court ruling makes any home or business in the vicinity of a commercial area more vulnerable than ever.

Robert Blau, an attorney representing homeowners fighting the exercise of eminent domain by Newport over a proposed shopping center near Interstate 471, said many communities will be better disposed to commercial developers.

"I think the entire city of Newport is under threat," he said.

Specifically, the court's landmark 5-4 decision Thursday upheld the right of New London, Conn., to use eminent domain to acquire homes and businesses to allow a developer to raze them and build a hotel, health club and offices.

But more broadly, it established that the benefits of economic development, such as more jobs and tax revenue, are a public good that justifies the use of eminent domain.

The case has many parallels to Norwood's court fight to use eminent domain for an area next to Interstate 71 so that the Rookwood Exchange - a complex of offices, retail, condos and restaurants - can be constructed. The development is expected to infuse $2 million a year in tax revenue to financially strapped Norwood.

It's not clear what impact, if any, the court decision will have on the Norwood eminent domain case, which is before a state appeals court. Although the U.S. Supreme Court removes some obstacles to eminent domain, it still gives the state supreme courts the right to provide more protection for property owners.

The other big eminent domain case in Hamilton County is the fight involving Cincinnati and some property owners in the Calhoun Street business district in Clifton Heights.

Cincinnati wants to seize the property and turn it over to a nonprofit neighborhood development group. This group would buy the properties, demolish the buildings and allow the construction of a $270 million project.

Two holdout property owners recently settled with the city, but the owner of the Hardee's and Arby's restaurants still hasn't agreed to sell.

Robert Manley, an attorney representing the property owners, said the court decision will have little impact on his case.

But Manley, who represented business owners in eminent domain cases connected with the construction of the old Riverfront Stadium and Paul Brown Stadium, said he strongly opposes the court's majority stance on eminent domain.

The court's ruling, Manley said, is based on an assumption that cities' economic development plans actually work and benefit the public good.

"The problem with that is that in the last 50 years, every urban renewal plan Cincinnati has undertaken has failed," he said. "These urban renewal plans are disasters all across the country. And this decision will encourage more disasters."

But Chris Bortz, a lawyer for Towne Properties in Mount Adams and a candidate for Cincinnati City Council, said the court decision benefits Cincinnati by making it easier to assemble a large tract of land in a neighborhood like Over-the-Rhine for redevelopment.

"It's an area where you have a large number of absentee landlords holding onto declining property," Bortz said.

Newport City Manager Phil Ciafardini said the court ruling bolsters Newport's eminent domain case involving the proposed shopping center on the 56-acre site overlooking I-471 between 10th Street and Carothers Road. Lower courts have ruled in Newport's favor. The case is before a state appeals court.

He said Newport won't go on an eminent domain spree.

"It's used as a last resort and very sparingly," he said.

It also can be risky. Voters in Lakewood, Ohio, got involved in an eminent domain fight waged by 17 home and business owners in a neighborhood the Cleveland suburb declared blighted.

But Lakewood voters rejected the development plan in 2003. Last year, the voters rescinded the "blighted'' designation for the area.

Stacey Woolley, a 44-year-old violinist with the Cincinnati Symphony Orchestra who lives in Clifton, said he doesn't feel as secure as he did before the court's ruling.

He lives 1½ blocks north of the Ludlow Avenue business district. He said that even if his block is spared from eminent domain, the area between Ludlow Avenue and his block could be vulnerable.

"I could wind up a half a block from a big parking lot with bright lights and a chain-link fence," he said. "If you live in a transitional neighborhood, you've just been discouraged from putting one penny into your house."

6/27/2005

There's the punishing tax burden levied by state and local governments that see small firms not so much as vital cogs in the commonwealth's economic engine as cash cows to be milked to pay for more government spending.

There's the increasingly complex maze of labor, environmental and other regulations that ensnares scarce capital that could have otherwise been used to hire new workers, reward existing employees, or invest in equipment and training that improves products and services for consumers.

And finally, there's the difficulty in just finding qualified people to staff their organizations-the direct consequence of a government-run school system that fails to provide too many young Pennsylvanians with even the most rudimentary workplace skills.

But for some Pennsylvania business owners, all of the aforementioned problems are dwarfed by an even more fearsome possibility: That government and quasi-government authorities will swoop in and shut down their business by using the power of eminent domain.

Under eminent domain, the government can take privately owned property in the "public interest," as long it pays the owner what it determines to be "fair market value." The owner has little say in the matter if the action is determined to be for a "public good"-and in recent years, governments have stretched that definition to the breaking point.

In Central Pennsylvania alone, there are two recent glaring examples of this growing problem. The first is the proposed taking of Cramer Airport Parking. Stan Cramer has been in the parking business for more than two decades. He, his wife, his son and his daughter run their airport parking and car rental business near the Harrisburg International Airport (HIA) in Middletown. As one can imagine, location is everything in the airport parking business.

Now the Susquehanna Area Regional Airport Authority (SARAA), which owns HIA, is trying to take the Cramer family's 17.6 acres. HIA's aviation director says the authority needs the Cramer property in order to attract a cargo transfer or airplane maintenance facility that would lease the property from SARAA. This raises the question of whether or not the authority is doing the adding of a private business interest-but the questions don't end there.

Still unaddressed is the issue of how taking the Cramers' land would affect the parking choices available to the airport's consumers. For without the Cramer parking business, HIA, which recently built a new parking facility, would hold a monopoly on airport parking.

Saying that SARAA has not offered them fair market value and that they could not relocate their business, the Cramers plan to fight the authority in court. And they may not be alone in taking legal action. The Pennsylvania Attorney General's office is looking at the issue with an eye toward potential antitrust violations.

The Cramers' anger and frustration is not unique in the Central Pennsylvania region. Recently, the United States General Services Administration announced that it has selected three potential sites for a federal courthouse in Harrisburg. Building on one of those sites would displace half a dozen small businesses and residents who live in restored historic homes. Those property owners also plan to fight to defend their rights.

Unfortunately, the abuse of eminent domain is not just a local phenomenon. It is happening across the country-and its pace is likely to quicken in the coming years. For while eminent domain was once generally limited to the taking of private property for truly "public" uses such as roads, government bodies are increasingly using eminent domain to allow developers or other businesses to find other private uses for the property that generate more revenue for the government's coffers than the existing owners do.

This expanded definition of eminent domain was recently challenged by some Connecticut property owners. Sadly for the Cramers and others threatened with the taking of their businesses or homes, the United States Supreme Court just gave land-hungry governments nationwide the green light to bring the bulldozers through their front doors in the name of "progress."

In Kelo v. City of New London (CT), the Court decided, by a 5-4 vote, that it is constitutional for a governmental body "to take property from one private party in order to give it to another private party because the new owner might produce more profit and more taxes for the City from the land," as summarized by the Institute for Justice (IJ), a national libertarian non-profit litigation group that argued the case.

The Kelo ruling will undoubtedly make the Cramers' fight to keep their business even more difficult-and it should send a shiver down the spines of all property owners here in the mid-state. Living, let alone running a business, in Pennsylvania only continues to get harder.

The U.S. Supreme Court, in a ruling watched closely in New Jersey, on Thursday upheld a Connecticut city's right to seize homes and other properties solely for economic development.

The 5-4 decision is likely to make it easier for dozens of North Jersey towns to use eminent domain condemnations in similar ways, supporters and opponents of the decision agreed.

"Englewood, Ridgefield, Passaic - many towns have been adopting plans in the past several years based on economic redevelopment, and I believe this means that it's now full-steam ahead," said Bruce Rosenberg, a land-use attorney for the Hackensack-based law firm of Winne, Banta, Hetherington, Basralian & Kahn.

"This is what could be called the Supreme Court's imprimatur on those efforts, basically adopting what New Jersey already has adopted in its legislation."

Clifton, Lodi, Paterson and Hawthorne are among the other North Jersey communities using or considering using eminent domain condemnations for economic purposes.

Fair-housing groups and potentially displaced tenants were among those who railed against the court's refusal, in the Kelo v. New London case, to reverse decades of broadening use of eminent domain, which at one time restricted the taking of property to such public benefits as highways and bridges.

"This creates open season on neighborhoods," said Jeff Tittel, executive director of the New Jersey chapter of the Sierra Club.

In Ridgefield, where more than 60 businesses in a 30-acre tract have been earmarked for redevelopment, the decision disappointed business owners.

"It gives local governments too much power," said Thomas Bonanno III, whose family-owned real estate group rents commercial space to 27 companies, employing more than 150 people in the area.

"It destroys people's livelihoods and takes away their property."

The linchpin of the Ridgefield plan is the 15-acre site of the former Pfister Chemical plant, next to Overpeck Creek and south of Route 46. It includes an abandoned factory, loading docks and chemical tanks.

Alan Mallach, research director for the Montclair-based National Housing Institute, said he did not object to the court's upholding of the principle of eminent domain.

"But what the court didn't recognize is that there is a real problem of abuse in a whole bunch of towns in New Jersey, where the economic redevelopment power is used in areas where the main objection is that there are too many poor people there or too many renters, " Mallach said.

"I personally think that there ought to be some constraints."

Former Fair Lawn Mayor Ed Trawinski, an attorney with expertise in land use and zoning, said the power of municipalities is now so broad that a town council could, for instance, condemn a city block simply to replace large-family dwellings with residential options that would require fewer city services.

But Scott Mollen, an attorney for Herrick Feinstein, which has offices in Newark and Princeton, said that the court properly recognized that New London is an economically depressed town that needs to change with the times.

"The majority recognized that the benefits to the community at large outweigh the rights of an individual property owner to, in essence, block important urban redevelopment, especially when the law already requires that an owner receive fair and just compensation," Mollen said.

Lodi trailer park residents have a court date for July 18, when they hope to prevent losing their homes to a private developer's plan to construct a gated senior-living community and retail property on the land. "It certainly would have been helpful if they placed some limitations on its [eminent domain's] use," said Kendall Kardt, president of Save Our Homes, the group organizing the legal fight for residents of Brown's Trailer Park and Costa Trailer Court.

Lodi Mayor Gary Paparozzi called the ruling a "shot in the arm" for the borough.

"The trailer park is like a poster child for redevelopment," Paparozzi said. "That's the best-case scenario for using eminent domain."

Mary Gail Snyder, research fellow for the National Housing Institute, said that the trend toward waterfront development in New Jersey in areas such as Hoboken and Jersey City is not necessarily affected, because most of that land consists of large parcels with a single owner.

"But this ruling could now allow the same market trend to expand even to where there are neighborhoods," she said. "Before, developers were discouraged from that, because you'd have a lot of small landowners and it would have been harder to get all of them to agree [to sell]."

The ruling was hailed by Newark Mayor Sharpe James, whose city is planning a $550 million, 2,000-condominium project on a 13-acre parcel that was declared blighted for eminent domain purposes in November.

"Our Mulberry Street project is a clear example of the Supreme Court ruling where the future of the city is more important than private profit motivations," James said in a statement.

Mollen, the lawyer, disputed contentions that Thursday's ruling will dramatically affect the New Jersey redevelopment landscape.

"Most government agencies already have been proceeding on the assumption that economic development is a valid justification [for invoking eminent domain]," Mollen said. "I don't expect any unleashing of massive new development."

Supporters and opponents both agreed on one thing: The ruling does not preclude the state Legislature in Trenton from passing a law restricting the use of eminent domain.

"If a state wants to set the bar higher for eminent domain use, it still can," said Dianne Brake, president of the Trenton-based Regional Planning Partnership. "The process has to be transparent, for instance, to help avoid having graft come into play."

Justice John Paul Stevens wrote for the majority that it was up to local officials, not federal judges, to determine what uses of eminent domain are beneficial.

The court's other left-leaning judges agreed, while moderate Sandra Day O'Connor wrote in her dissent of a concern that "disproportionate influence and power" was being granted to municipalities.

U.S. high court says local governments can seize land even for private development

By Karen Holzmeister

In a national decision with local implications, the U.S. Supreme Court ruled Thursday that local government agencies can use eminent domain on behalf of private development projects that will raise tax revenue.

Eminent domain is the power of a government agency to take private property — including homes — for public use through condemnation and compensation.

Writing for the court in the 5-4 ruling, Justice John Paul Stevens said local officials, not federal judges, know best in deciding whether a development project will benefit the community.

The case represented a defeat for some New London, Conn., residents who sued after city officials announced plans to raze their homes in a working-class neighborhood for a riverfront hotel, health club and offices.

The court essentially ruled that even a private development can be considered a public use if it raises tax revenue or benefits the public in other ways. It also ruled that property can be taken even if it isn't blighted.

However, the public shouldn't interpret the ruling as "government running amuck and using its powers of eminent domain to help out developers," James Sorensen, Alameda County's Community Development director, insisted Thursday.

"The court took great pains to point out the public purpose, and New London demonstrated a legitimate public purpose of boosting economic growth," Sorensen said.

However, he called the decision "pretty significant" for the county's redevelopment agency in particular, and California in general, since it reaffirms an agency's ability to use eminent domain to eliminate blight or to create economic development opportunities. At issue was the scope of the Fifth Amendment, which allows governments to seize private property through eminent domain if the land is for public use. City officials in New London envision a commercial development that would attract tourists to the riverfront, near a research center and proposed Coast Guard museum.

Justice Sandra Day O'Connor argued against the ruling — a ruling that could lead to the elimination of the New London neighborhood of Victorian-era houses and small businesses. In dissenting, she said cities should not have unlimited authority to uproot families — even if they are provided compensation — simply to accommodate wealthy developers.

Castro Valley resident Ken Carbone, a county Planning Commission nominee, sees both sides of the issue. He's concerned about proposed county designations for low- to moderate-income residential sites in unincorporated areas that could hurt neighborhoods.

"If a property owner spitefully holds out, we need to get around that," he said Thursday. "But that doesn't mean that the county should just walk in and take (the property)."

In Hayward's latest eminent domain proceeding, the City Council has authorized its redevelopment agency to file a complaint of eminent domain against the owner of a B Street building. The property has not been improved in compliance with a years-old city ordinance requiring downtown property owners to update unreinforced masonry buildings. The issue has not yet been resolved. While Hayward City Manager Jesus Armas said the ruling is a positive development for cities, he said Hayward rarely uses eminent domain — and then only as a last resort — when negotiations don't work.

He also noted that in California there already are strict requirements on how redevelopment areas can be established and how properties can be deemed blighted.

San Leandro City Manager John Jermanis said the ruling is an important decision because it reaffirms cities' ability to use the powers of eminent domain when it is absolutely essential.

"Our council will continue to be very cautious in use of eminent domain and reserve it for public purposes that benefit the community, such as parks, street widening and other public facilities," he said.

Jermanis said San Leandro has used eminent domain in the past in the creation of the Marina Boulevard Auto Mall, which in the long run has been successful for the city during recent economic setbacks.

Nationwide, more than 10,000 properties were threatened with condemnation, or condemned, in recent years, according to the Institute for Justice, a Washington, D.C., public interest law firm representing the New London homeowners.

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